FICA Alternative Plan
The Omnibus Budget Reconciliation Act of 1990 (OBRA 90) introduced into law Internal Revenue Code Section 3121(b)(7)(F). As a result, you, as a part-time, seasonal or temporary employee of a government employer, may deposit money into a private retirement plan, instead of Social Security. Thus you are not covered under Social Security.
- Under the 401(a) FICA Alternative Plan, you contribute 7.5% of your compensation to an account in your name.
- Any benefits which you have earned under any other retirement plan (as well as social security benefits) will not be reduced by participating in this plan.
- If you leave a position covered by this plan for any reason before retirement, you can withdraw the balance of your account, or continue to save the funds for retirement.
- You contribute before tax withholding is calculated, which reduces your income taxes.
- You pay no taxes on your contribution or the earnings in your account until withdrawal.
- Investments are controlled by the participant. You may change the investment whenever you like by obtaining a new investment election form from BENCOR Administrative Services by phoning 1-888-258-3422 or visit www.bencor.com
- There are no administrative fees for this plan.
- Withdrawals from the plan may be made at the following times:
1. Termination of employment
3. Age 59 1/2
4. After age 70 1/2 or retirement, if later, when the IRS requires that minimum distributions be made to the participant each year.
5. Your total disability
6. Your death
- To request a withdrawal, contact BENCOR Administrative Services at 1-888-258-3422 or log on to their website at www.bencor.com. Click here for a quick guide to BENCOR's website.
- For more information on the FICA Alternative Plan, please click here